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Introduction

This report documents the Environmental Assessment (EA) process of the Canada-Jordan Free Trade Agreement (FTA) negotiations subsequent to the Initial EA. Canada and Jordan concluded negotiations on a “goods only” FTA as well as associated agreements addressing labour cooperation and the environment on August 25, 2008. The full texts of the Canada-Jordan FTA and the associated agreements are available on the Canada-Jordan FTA webpage.

The Environmental Assessment Process

FTA negotiations are subject to the 2001 Framework for Conducting Environmental Assessment of Trade Negotiations. This process focuses on the likely economic effects of trade negotiations, as well as their likely environmental impacts in Canada. Three phases are involved: the Initial EA, the Draft EA, and the Final EA. The middle phase, known as the Draft EA, is not undertaken if the FTA is not expected to result in significant environmental impacts in Canada. Accordingly, in the case of the Canada-Jordan FTA negotiations, a Draft EA was not carried out. Consultations were an integral part of the EA process.

Findings of the Initial EA

An FTA between Canada and Jordan has the potential to expand opportunities for Canadian companies in Jordan, and the broader Middle East and North African region.

Tariff reductions in the context of an FTA with Jordan are expected to generate commercial benefits for Canadian exporters in a variety of sectors, including forest products, agriculture and agri-food, and machinery.

Given the relatively low levels of trade between Canada and Jordan and the overall size of the Jordanian economy, even a dramatic increase in exports to Jordan would have a modest impact in relation to overall Canadian trade and production levels.

Any environmental impacts resulting from Canadian export and production increases are expected to be of minimal significance.

Tariff reductions are also expected to result in increased Canadian imports from Jordan, notably in the apparel sector, although these would continue to constitute a very small share of Canada’s global imports in this sector.

No environmental impacts are expected to derive from FTA-related increases of imports from Jordan.

Results of the Consultation Process

The Government of Canada consulted the Environmental Assessment Advisory Group (EAAG) and representatives of the Provinces and Territories in June 2008 and received no comments on a draft Initial EA for the Canada-Jordan FTA negotiations. The Government then posted the Initial EA on its website and sought public input from June 27 to July 25, 2008. Again, no comments were received.

Results of the Final EA

The purpose of the Final EA is to document the outcome of the negotiations in relation to the EA process, including any new issues raised through consultations. The Final EA of the Canada-Jordan FTA negotiations re-affirms the findings of the Initial EA, namely that FTA-related economic effects are expected to be modest; and that FTA-related environmental impacts in Canada are expected to be insignificant. Moreover, no new issues arose during the latter stages of the Canada-Jordan FTA negotiations with respect to potential environmental impacts in Canada. As a result, no additional analysis was undertaken.

Environmental Provisions in the Canada-Jordan FTA and Agreement on the Environment

The Canada-Jordan FTA contains several trade-related environmental provisions, and a principles-based Environment Chapter. There is also a separate, parallel Agreement on the Environment. Provisions in both these agreements are consistent with those found in other Canadian FTAs and parallel agreements on the environment.

The Canada-Jordan FTA includes two key environmental provisions in the institutional area of the FTA text. Based on GATT Article XX, Article[ X-1] of the Exceptions Chapter contains a general exception with respect to the protection of human, animal or plant life or health, as well as the conservation of exhaustible natural resources. Article [X-5] of the Initial Provisions Chapter includes a conflict-of-law provision outlining the relationship between the FTA and certain Multilateral Environment Agreements containing specific trade obligations, which are in force for both Parties. The Environment Chapter within the FTA includes environmental objectives and summarizes the obligations set out in the parallel Environment Agreement.

the commitment not to derogate from domestic environmental laws to encourage trade or investment;

compliance with and the enforcement of environmental laws;

accountability, transparency and public participation on environmental matters; and

the assessment of the environmental impacts of proposed projects.

Conclusion

Even if dramatic increases in bilateral trade flows occurred as a result of the implementation of the Canada-Jordan FTA, the economic effects of this Agreement would be modest relative to Canada’s overall economic activity given the relatively low levels of bilateral trade and the size of the Jordanian economy. As a consequence, related environmental impacts in Canada are not expected to be significant. Moreover, environmental impacts, if any, will be addressed and managed by existing environmental management programs in sectors that stand to gain from the FTA such as forestry and agriculture.

Any comments received will be circulated to the Government of Canada’s Environmental Assessment of Trade Steering committee in order to help inform future EAs of trade negotiations and related policy development and decision-making processes.